Ethereum Down 19% In A Month: Could Japan’s Rate Hike Spark a Rally?

Ethereum (CRYPTO: ETH) has seen a 19% decline over the past month, but traders are positioning for a potential rally.

Trader Notes: Historically, ETH experiences a sharp wick within two weeks of a Bank of Japan (BoJ) rate hike, according to analyst Benjamin Cowen in a podcast published on Monday.

He attributes this to the broader impact of monetary policy on risk assets.  In January 2025, the BoJ hiked its interest rates not seen since 2008 financial crisis. The next rate hike is likely expected in July with expectations at 0.75%, a Reuters poll estimated.

Cowen also pointed out that ETH’s performance remains closely tied to Bitcoin—if BTC pumps, ETH/USD tends to follow. Also, the end of quantitative tightening, expected this summer, could be a major tailwind for ETH. For ETH/BTC to truly bottom, BTC would need to struggle in making new highs.

Meanwhile, Trader Tardigrade remains bullish on ETH at current levels, arguing that selling now is unwise.

Statistics: IntoTheBlock data shows Ethereum’s large transaction volume narrowed by 7.6%, while daily active addresses are up 3.8% in a single day. Exchanges netflows witnessed a significant 875.9% spike. Transactions greater than $100,000 have increased from 6,311 to 6,592.

Coinglass data shows Ethereum liquidations in the past 24 hours at $56.6 million, with long liquidations of $40.8 million.

Community News: The Pectra upgrade launches today on the Holesky testnet, with a mainnet rollout expected soon. This upgrade will enhance Layer-2 scaling and validator experience, further strengthening Ethereum’s infrastructure. 

ETHDenver will take place from Feb. 27 until March 2. Crypto trader ElonMoney expects bullish momentum, predicting key alpha leaks and potential Pectra-related announcements to drive ETH prices higher.

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